2024 has got off to a fast start. See below a summary of our top 10 trends and developments to keep an eye out for in the year ahead in the resource management space.
RMA Reform
We had a "once in a generation" opportunity for RMA reform with the development of the Natural and Built Environments Act and Spatial Planning Act that were enacted late last year. However, it seems that "a generation" is now actually less than one three-year political term. With their ink still wet, the Natural and Built Environment Act (NBA) and Spatial Planning Act have both been repealed (save for a limited saving in relation to fast-track consenting discussed below).1
The new Government will begin the process of developing a new resource management framework this term. Unlike the previous Government's approach, which was to largely follow the recommendations of the Resource Management Reform Panel chaired by Tony Randerson, the new Government has greater freedom as to what the new framework might look like. That will provide significant opportunities for bright ideas to be incorporated into any new proposal. While we do not expect to see the new system proposed this year, there is plenty of work for the new Government to do to develop it.
Under the Coalition Agreement the new system is to be "premised on the enjoyment of property rights as a guiding principle". How that will play out remains to be seen, given that a resource management system is by its very nature an accepted encroachment on that principle, and given the concern expressed by each of the parties making up the Government with the development enabled by the previous Government's housing intensification proposals.
In the shorter term, we can also expect changes to the Resource Management Act, which has had new life breathed into it (for now). We address below in further detail some of the policy areas that are likely to see further development this year.
Fast tracking
Fast track consenting has become increasingly fashionable in recent years. We have already seen two iterations of fast track consenting come into law, first through the COVID-19 Recovery (Fast Track Consenting) Act (FTCA), and then through the NBA. The NBA fast track process remains in force and is able to be used, although a new fast-track process is expected imminently.
The Minister for RMA Reform has indicated work on the Bill is happening at pace and the Bill is intended to be introduced in early March. The fast-track process will be similar to the existing processes (ie two stage, with a Ministerial decision at referral stage followed by an Expert Consenting Panel at consent stage). We also expect it to list some projects in the legislation itself that go automatically to the second stage (ie the referral would be baked into the legislation).
The NBA fast-track process is limited to housing and infrastructure. While these are both critical sectors, in our view any new fast track regime should not close the door on other projects that have the potential to provide significant benefits (and so there should be a broad discretion at the referral stage that is not confined to limited types of activities).
Housing Intensification
The housing intensification plan changes mandated by the previous Government (with bi-partisan support) are now at various stages across the country. These intensification plan changes, particularly the medium density residential standards that came with them, have been heavily criticised and the new Government has signalled it will be stepping back from a mandated intensification approach, allowing councils greater autonomy and nuance as to the levels of density to enable in their urban centres.
On the whole, this change in approach is anticipated to be welcomed by councils. We expect many councils to either revise their intensification plan changes or withdraw them entirely should an opt in/out approach be introduced (although a number of councils had statutory deadlines to notify decisions on their intensification plan changes at the end of last year, with some others fast approaching this year). Either until any opt in/opt out approach is implemented, or the Minister for the Environment extends statutory timeframes for notification of decisions, councils will need to continue with these intensification plan changes.
Greenfield development
A rapidly changing regulatory framework has made greenfield development much more difficult in recent years, with reforms including new national direction on freshwater, productive land, and indigenous biodiversity working together as barriers to both the consenting and rezoning of rural land for urban land uses. The Government has signalled that intensification alone cannot be relied upon to address housing supply issues, and more of a balance between intensification and greenfield development is needed. Changes are expected to the National Policy Statement on Highly Productive Land to better enable greenfield development. At the very least we anticipate protections on Class 3 soils removed, with possibly some relaxation to rezoning and consenting requirements for Class 1 and 2 soils where they are already subject to other constraints to their productive use.
Despite access to new funding and financing mechanisms (for example, those under the Infrastructure Funding and Financing Act introduced in 2020), new infrastructure costs remain prohibitive. To address costs of urban development already anticipated, we have also seen Auckland Council looking to shift more of the upfront costs of infrastructure delivery onto developers through a revised development contributions approach in Drury. This is expected to be rolled out in other growth areas throughout Auckland this year, and we expect other Councils emboldened to adopt a similar approach as part of future development contribution policy reviews.
As Councils look to minimise spending over 2024, we may see developers asked to front up more of the primary infrastructure costs through full or partial private funding arrangements to ensure timely infrastructure delivery can be achieved.
Freshwater
2024 was anticipated to be a massive year for freshwater with all regional councils required to prepare and notify their freshwater plans by the end of 2024. The Government has pushed out those timeframes, giving councils an additional three years, until the end of 2027. That will provide some breathing space in what has been a frenetic period for all interested parties. However, there will be a new National Policy Statement for Freshwater issued – the fourth version of that NPS over the last 10 years. The process to develop a new NPS for freshwater is expected to take 18 to 24 months and include a detailed consultation process with all stakeholders including iwi and the public. We expect that process may result in a softening of some aspects of the current NPS.
Renewables
The renewables sector is expected to be a key winner from the Government's proposed reform package.2 There is a clear drive to make it easier to consent new renewable generation. Fast-track is currently provided for in the carcass of the NBA. We expect that to be a short-term solution, while a replacement framework is developed. We expect that new consenting framework to also specifically provide for offshore wind. That will be music to the ears of several large players in that space, who are currently awaiting the development of a licensing regime to provide investment certainty for undertaking feasibility studies.
We also expect that clarity will be provided for solar developers to some of the drafting fuzziness in the National Policy Statement for Highly Productive Land, which has resulted in some varied approaches by decision-makers on the consenting of large-scale solar projects.
Infrastructure pipeline and politicisation of projects
The tit for tat nature of politics has been on display in the infrastructure space, with Auckland Light Rail, Let's Get Wellington Moving, Lake Onslow Project, and iRex following the same fate as the East-West Link from 2017. The repeated calls of the New Zealand Infrastructure Commission and Infrastructure New Zealand for an agreed pipeline of major infrastructure projects resonate. In the resource management space, infrastructure will be a key benefactor of a new proposed fast-track consenting framework. The decision of the Supreme Court on the East-West Link is also anticipated shortly, and is expected to provide important commentary on resource consent and designation decision-making for major infrastructure.
A cooling on climate change?
The previous Government shepherded in amendments to the RMA to require consideration of climate change effects on air discharge applications. We expect that the new Government will consider whether those amendments should remain in place, particularly in light of some of the questions being raised about how their implementation. Meanwhile, the law on civil liability for greenhouse gas emissions continues to evolve, with the Supreme Court releasing its decision on Smith v Fonterra yesterday.3
The resource management system has been identified as a key mechanism to drive the land use change necessary to meet New Zealand's climate change mitigation and adaptation goals, but the emphasis that the new Government will place on these twin climate objectives in any future systems reform remains uncertain.4 In relation to adaptation, the previous Labour Government has intended to release a bespoke legislative framework under the Climate Change Adaptation Bill, but this was not introduced prior to the election. The new Climate Change Minister, Hon. Simon Watts, has indicated that climate adaptation is a "significant priority" and that work is underway on an adaptation framework.
Continued recognition of the significance of Te Ao Maori in decision-making
The increasing significance of Te Ao Maori and tikanga in environmental decision-making has been a growing trend for a number of years. That was certainly the case in 2023, with decisions from different divisions of the Environment Court on two major infrastructure projects late last year reinforcing the centrality of cultural considerations to the Court's decision-making.
The growing incorporation of tikanga into the law alongside the principles of Te Tiriti has become somewhat of a political football. Many resource management practitioners may have slightly bemused reactions to some of the concerns being expressed with the increasing recognition of tikanga in other areas of the law, given the considered development of jurisprudence on the issue by the Environment Court over a number of decades. We expect the political rumblings in relation to these matters are unlikely to alter the current trajectory of recognition of the significance of cultural considerations on major projects.
Public Works Act
As part of the broader RMA reform package, the Government has indicated it will be looking to simplify related legislation such as the Public Works Act. The Public Works Act is old (pre-dating the RMA) and there is an opportunity to ensure the Public Works Act framework is well-integrated into any new resource management system. Greater integration between the PWA and consenting/designation processes would provide significant efficiency benefits for all parties and would be a big step forward on the current split processes.
[1] See our summary of key policy changes of the new Government here.
[2] See our latest energy blog here on developments in the energy sector for 2024.
[3] See our article on Smith v Fonterra here.
[4] For more on climate change more generally, see our ESG 2023 round-up and trends to watch article here.
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